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Natural infrastructure and watershed investments could serve as valuable solutions to the ongoing droughts happening in California and elsewhere. The latest article in our Crowdrise series looks at nature-based solutions to the global water crisis drawing on findings from the State of Watershed Investments 2014 report.

3 November 2014 | The punishing California drought has become part of our national consciousness, with the bad news seeming to grow worse each week. Last year was the driest on record for much of the state, and in January of this year, Gov. Jerry Brown declared a drought state of emergency and directed officials to take all necessary actions to prepare for water shortages.
California residents can be heavily fined for wasting water, and nothing seems to escape the drought’s ill effects — including Halloween(pumpkin growers in the state are suffering from the water shortage). The state’s lakes are at “crisis levels,” and the drought will cost the state $2.2 billion and close to 20,000 agricultural jobs this year. Parched forests are vulnerable to forest fires, creating a terrifying and often deadly situation for nearby residents, ever-vigilant for the smell of smoke in the air.

In September, the governor signed legislation to make the state more resilient to drought and strengthen local management and monitoring of the state’s water needs. The problem isn’t just a lack of rain; it’s a lack of resilience in the forests and fields that collect what little rain does come and funnel it into rivers. “We have to learn to manage wisely water, energy, land and our investments,” said Brown. “That’s why this is important.”

“The fractions of the global population that will experience water scarcity and be affected by major river floods are projected to increase with the level of warming in the 21st century,” the IPCC said.

A Global Crisis

The water crisis has been a part of our global consciousness for years, and the message has been clear: Keep it clean, don’t waste it. But sustainable, working solutions and a full picture of the crisis have been less than straightforward.

Alarms have been raised across the country, as in Ohio where there have been exceptionally high levels of algae found in Lake Erie. The algae produces a toxin for which there are no federal or state standards of acceptable levels – even though it can be lethal. Globally, 70 percent of water use is for agriculture, and agriculture is largely unregulated under the Clean Water Act. That algae blooming in Lake Erie, for example, can be attributed to animal waste and fertilizer run-off from farms.

The need for a sustainable clean-water solution is clear — and probably not the kind of solution that most people might think of, according to the State of Watershed Investment 2014 report, published by Ecosystem Marketplace, an initiative of the nonprofit Forest Trends. The report might just change the way you think about water — and give you reasons to be optimistic about our future.

The report presents nature-based solutions — forests as filters, for example — to the problem of sustaining the planet’s clean-water supply. And in the face of manifestations of the crisis like California’s severe drought, solutions demand our attention and support.

Nature as Infrastructure: An Answer to the Problem

What has been largely missing from the discussion about our water crisis is the connection between land use and adequate water.

Forests, wetlands, and grasslands work as sponges, saving excess water in the wet season for drier periods of the year, and as filters, removing contaminants that threaten public health. This “natural infrastructure” also regulates local and global climates, and prevents erosion. Protecting and enhancing nature’s ability to do this work keeps water safe and well-timed.

“We’re finding that the global water crisis is forcing governments and business to get creative,” says the report’s lead author, Genevieve Bennett. “Why is Coca-Cola helping the U.S. government reduce the risk of wildfire on forest lands? Why are water utilities paying farmers to go organic? Because it’s often more cost-effective to keep the landscape healthy — and keep your water supplies clean and flowing at their source — than to deal with pollution and supply disruptions after they’ve already happened. For a long time we’ve focused mainly on how to solve water problems through engineering alone.”

Denver found exactly this creativity when it recognized the stakes of increasingly severe forest fires in the city’s catchment. Beyond causing millions of dollars in firefighting costs and property damage, just one fire could result in sediments and heavy metals entering the city’s water supply — increasing treatment costs dramatically. To tackle this issue, the utility Denver Water partnered in 2010 with the U.S. Forest Service to improve forest management in the city’s catchment — reducing wildfire risk, stabilizing soils, and improving the timing of the delivery of snow melt to downstream users. As a result, water user fees in Denver don’t only contribute to keeping the lights on at the treatment plant; they also support the maintenance of critical natural infrastructure on which the city depends.

“We tend to think of water management as something that happens around population centers, for human consumption, but that’s only a small part of the picture,” says Gena Gammie, manager of the Water Initiative at Forest Trends. “The water challenges we face require solutions that stem from broader thinking. We have to consider the landscapes that catch and deliver water, through to the agricultural and energy-production systems our society depends upon.”

The new report shows how water users have begun to creatively engage full landscapes to improve water resources management, complementing the protection of “natural infrastructure” with positive incentives for agricultural producers to implement better land use practices. In fact, the majority of programs tracked by the report work on improving management of productive lands, or combine this strategy with the protection of natural areas.

China, where critical water shortages are a major problem in addition to pollution, is a leader in this kind of investment, “watershed investment,” and its programs account for 90 percent of watershed investment in the world, according to the report. Many such “eco-compensation” programs pay landowners to take degraded or marginal lands out of agricultural cultivation to protect water sources.

Does Watershed Investment Work?: The Need for the Data

The report is one-of-a-kind in the breadth of its tracking of watershed investment programs around the world and its quantification of the impacts of these programs. The information gathered, therefore, can be invaluable in assessing whether watershed investment is actually effective and for which reasons.

The report found, for example, that in 2013, governments and companies invested $9.6 billion in nature-based solutions to the water crisis. At least $6 billion of this funding went to more than 7 million households, and restored and protected 365 million hectares — an area larger than India. This amount of investment is up from transactions in 2011, which Ecosystem Marketplace benchmarked at $8.2 billion. This increase points to continued growth in the sector, and most importantly, governments’ and businesses’ willingness to prioritize clean water supplies — and their appreciation for alternative ways to achieve that end.

The report offers a unique opportunity to discuss these types of programs in depth, and the data it presents are especially important in terms of attracting investment and buyers in watershed investment. “I’m not aware of another source of information out there that attempts to really rigorously track these investments or offer a framework for thinking about them. Natural capital investment is just like any other investment in that you need information to make good decisions,” says Genevieve Bennett.

Trees, Water — and People

Investment in watershed services can reach beyond the land and the water. It can affect people living in and managing the watershed as well, bringing them into the deal. Residents might receive cash payments, technical support, and other needed materials. Projects that work with land users to ensure that investments targeting water benefits also offer sustainable livelihood benefits “are generally more effective over time,” says Gena Gammie.

In cities, too, people can benefit from this kind of investment. “Worldwide, many cities are growing faster than they can sustainably incorporate and meet the needs of new residents,” says Gammie. “So to the extent that watershed investment can function as urban-rural bridges that support, develop or strengthen rural economies in a green and sustainable way, then that’s good for cities, as well.”

An example of such a success story is Working for Water in South Africa, where invasive plants cause tremendous damage and threaten water security. Working for Water, administered through the country’s Department of Environmental Affairs in partnership with local communities, each year provides training and jobs in clearing these plants to 20,000 people, 52 percent of whom are women. The program is recognized internationally for its success in fighting poverty for these workers, and is an example of how the water, food, and environment nexus can be addressed with a holistic solution.

“Watershed investment isn’t just a conservation issue,” says Bennett. “It’s also potentially a very powerful tool for helping us address pressure on our water, energy, and food systems. We should be thinking about natural infrastructure when we consider how to extend basic water services to everyone on this planet, or in preparing for a changing climate or meeting future demand for food or energy.”

An area larger than the size of India — that’s the amount of land over which these kinds of nature-based solution have been implemented successfully. And that means there’s reason for optimism — but only if these kinds of best-practice solutions are scaled up and adopted across our planet.